Abe team to craft bill to galvanize industry

Legislation to form major pillar in strategy for economic growth

The Abe administration plans to draw up a bill to help Japanese industry compete globally as a pillar of its growth strategy to fight deflation, according to sources.

The bill, to be submitted to the Diet this autumn, will aim to streamline sluggish businesses and prompt companies to enter new fields by offering tax breaks, the sources said Thursday. It will also provide support for people who want to change careers.

The growth strategy, expected to comprise around 30 items, including the use of private funds for public works projects and creating special economic zones, is one of the “three arrows” of Prime Minister Shinzo Abe’s campaign strategy, along with aggressive monetary easing and flexible fiscal spending.

Abe’s team will accelerate efforts to conquer nearly two decades of deflation by making extensive use of human resources, funds and information from both the public and private sectors.

The Cabinet plans to start finalizing the growth strategy this month and endorse it in mid-June — just ahead of the Upper House election. Abe aims to explain the details at the summit of the Group of Eight industrialized countries in Britain next month.

But many measures have yet to take shape. Abe’s team needs to quickly hammer out effective steps to bolster growth as it faces difficulty speeding up deregulation due in part to strong resistance from the agricultural and medical sectors.

The government will craft an “emergency structural reform program” for the next five years, the sources said.

To spur the economy by boosting investment and attracting foreign businesses, strategic special zones will be created in Tokyo as well as in Osaka and Aichi prefectures, where corporate taxes will be drastically cut.

The government has also proposed implementing measures to shore up the declining agricultural structure, such as boosting crop exports and promoting intensive farming, with an eye on entering talks on the tariff-cutting Trans-Pacific Partnership agreement.

Abe has also pledged to submit bills to move ahead with the practical use of regenerative medical techniques, including utilization of induced pluripotent stem cells, or iPS cells.